Payless to Emerge from Business Bankruptcy

It’s undeniable that we live in a world dominated by e-commerce. Massive internet sellers such as Amazon have cornered the market on retail by making shopping from home or at work an easy, convenient, and affordable option. Many individuals who simply don’t have time to run errands in today’s fast-paced world turn to the internet to do research and make big purchases, buy holiday gifts, and even stock up on groceries. But are there some things that simply can’t be bought reliably online? Payless ShoeSource is banking on that bet. The retail giant plans to open new locations in Asia and Latin America in order to boost their sales. Their brick-and-mortar approach flies in the face of current market trends, but they hope that their gamble will pay off.

The Business of Fashion reports that Payless has formulated this strategy in order to bounce back after their emergence from bankruptcy. Despite being $400 million dollars in debt, the company hopes to attract customers who don’t trust online stores when it comes to making shoe purchases. After all, shoes, and clothes in general, need to fit a wearer. Buying pants, shoes, or other wardrobe items online can be fairly risky since the purchaser can’t check for a good fit. Payless holds firm in its belief that brick-and-mortar shoe store locations will attract customers and serve loyal patrons. Their target demographic, families, often come to the store to make shoe purchases during specific, peak sales times. Easter, winter, and back-to-school periods send mothers flocking to the stores with their kids in search of a fitting, quality shoe at a reasonable price.

If Payless can generate a sales surge after declaring bankruptcy, it would be a victory for physical store locations.Retail bankruptcy has helped countless businesses recover and rethink their demographics. In Payless’s case, they were compelled to file for bankruptcy after accruing $847 million in debt. Now, they want to improve their competitiveness by building new stores in various locations throughout Latin America and Asia. They also want to adjust their inventory based on widespread public demand. As for their numbers, the company plans to take the next five years to rebuild, spending $234 million to try to get back on its feet. Their globalization plan spreads their physical locations to a wide range of countries and cities. They want to search for markets where brick-and-mortar shops can still succeed and build in those communities. Their lead officers have yet to give up on the promise of actual store locations, even in an industry where Amazon and other e-commerce retailers have seen such overwhelming success. The company does intend to remain committed to providing quality products at affordable prices. Perhaps many stores have faced such hardship because the internet retail boom hit quickly and took over markets speedily.